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Posts Tagged ‘Personal Finance’

Act in Haste, Repent at Leisure: The Spiral of Debt

It is very easy to get yourself into debt.  Everywhere you look; companies are promoting credit cards of all colours, shapes and sizes.  They tell you all about how good they are but do nothing about reminding you that they are going to cost you money.  And a lot of it.  It should be like smoking.  Every credit card should carry a large warning on the front of it ‘CAN DAMAGE YOUR WEALTH’.  Unless you are very good at avoiding these marketing techniques, then you likely have at least one credit card in your wallet.  And it doesn’t stop there. It became fashionable to get a new credit card with zero interest on it, and then when your interest free period expired, transfer it to another card.  Great idea you think!  No!  In reality what happens is you now have two credit cards in your wallet and it doesn’t take long for you to realise this and start using both of them. Disaster.

It gets to all of us.  If we then for some reason find ourselves with reduced income and unable to manage the repayments, we can start to lose control and fall into the ever increasing spiral of debt.  If you have found yourself in this predicament, and maybe found help via one of the debt-help charities, you know what it is like.  You have had your fingers well and truly burned.  But if all of your credit cards have been cut up, your cheque book shredded and your overdraft sent off to never-never land, what do you do when you have a temporary cash shortage?

No credit card for you.  In fact no more credit.  You have crossed the point of no-return and have to spend the next 10 years or so of your life paying back all that you owe.  So what if you have a cash dilemma?  Wonga offer an alternative to a payday loan.  They can help you, even if your credit is poor as they do not carry out traditional credit checks. Of course they will look at your cash liquidity and your earnings etc., but as you are limited to borrowing less than £400 for no more than 28 days, you will likely find that you will be accepted.  You will not be adding to your debts as you have to pay back the amount in full on a pre-agreed date.  The company will then take the sum due out of your nominated bank account without you having to raise a finger.  So, unless there are no funds in your account, your debt will be cleared in full.  No putting off until tomorrow what you can pay back today.  It’s a simple and straightforward way of coping when funds are short.  The great thing is, even if you are tempted to do so, you cannot put off the payback time.  It’s all about being responsible for your actions and accepting the fact that money is hard to come by.

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Be the first to comment - What do you think?  Posted by Cash Flow Mantra - September 8, 2013 at 8:22 am

Categories: Credit/Debt   Tags: , , , , ,

I am Getting a Financial Windfall

Recently, I found out that I will be getting a financial windfall.  Apparently several years ago (as in almost 20), there was a mistake with social security withholding during graduate school.  There ended up being audits and court cases, etc.  I simply provided some information that confirmed I was indeed a student at the time and gave the auditor permission to handle the rest.  I think the IRS got involved.  This all started several years ago.

Well, I got notice that I would be getting a check toward the end of this month.  Assuming that I actually see it, the amount is not all that small.  The money was actually put in escrow in an interest bearing account and actually doubled during the time that this has been going on.

Plans for the Money

Needless to say, the money will come at a good time.  I am working on paying off debt and feel that I am in a good frame of mind to be able to accept this money and not do anything stupid with it.  I plan on using the funds (since they weren’t expected) to pay off one of my credit cards and to pay the property taxes on the commercial building that will be coming due in May.

This will help me keep on track with my goal to eliminate consumer debt in another 34 months and provide some extra cushion so I don’t have to scramble for the tax money.  The timing couldn’t be better.

It is about time for some good news.

 

Carnivals

It has been forever since I linked to the carnivals that have featured my blogs so here goes:

Carnival of Retirement #60 – PT
Carnival of Financial Camaraderie #71 – GPM, CFM, PT
Finance Carnival for Young Adults   – GPM
Carnival of Financial Camaraderie #72 – PT
Yakezie Carnival – CFM
Lifestyle Carnival – PT
Carnival of Money Pros – GPM, PT
Carnival of Retirement #63 – PT
Carnival of Retirement #64 – GPM
I have been incredibly busy at work during the week and going to gymnastics meets on the weekends with state and regionals.  Finally, though, I should now have some more free time.  I need to help get the basement cleaned.  Ugh!
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12 comments - What do you think?  Posted by Cash Flow Mantra - April 10, 2013 at 8:35 am

Categories: Spending, Credit/Debt   Tags: , , ,

Rental Refi Did Not Work

I am kind of disappointed this morning since I found out yesterday that the refinance on the rental homes would not work.  Apparently, my credit score is not good enough.  Ever since 2008, it has been incredibly difficult to get credit so I will be focusing on getting out of debt instead.

Ultimately, it turns out that the net impact on the monthly cash flow won’t be all that different without the refinance.  That is because I had to have 2 appraisals and one came in below the expected amount.  As a result, I had set aside $10,000 to bring to closing in order to save about $650-$700 per month through decreased payments.

Now that the refinance won’t be going through, I will using that money to pay down a credit card balance in order to save over $2300 per year in interest.  Once I get this card paid off which should be in the next few months, I will save almost $800 per month in cash flow which can be added back into the budget.  So all is not lost with plan B.

Plan C

Then once that card is paid off and I get a little more credit card debt eliminated, my credit score may very well be in a better place that I could refi the rental houses, decrease my interest rate and my term.  I don’t anticipate rates moving up any time soon.  I would think that I have a year or more to get a better interest rate.

If not and rates start to increase, that would mean that the economy is heating up which will only help my retirement account investments in the stock market.  So I look at it as a win-win.

With this behind me for the time being, I can now focus on getting the business transaction complete and meeting my 2 goals for this year which are losing weight and paying off debt.  In fact, I am about to launch a blog solely devoted to working my way out of debt which should bring some increased accountability and motivation to the equation.

I will let you know when it is up and running.

 

Carnivals

Here are the recent carnivals that have included articles from my blogs:

Lifestyle Carnival  – CFM, PT
Carnival of Money Pros   – GPM, PT
Carnival of Financial Camaraderie #66  – GPM, PT
Thanks for reading and I look forward to nailing this debt over the next few years.

 

 

 

 

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8 comments - What do you think?  Posted by Cash Flow Mantra - January 30, 2013 at 9:08 am

Categories: Investing, Credit/Debt   Tags: , , , , , , ,

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